Rogers Communications is on a roll. Following its acquisition of Shaw, the company is exceeding expectations, reporting eight consecutive quarters of growth and solidifying its market-leading position in the Canadian telecom landscape. While analysts are focused on the obvious victories – impressive synergy realization, robust wireless subscriber growth, and a strategic premium brand strategy – a quieter revolution is brewing in Rogers' Cable division. Could a strategic pivot towards fixed wireless access (FWA) be the key to unlocking unprecedented growth in the vast Canadian market?

At first glance, Rogers' Cable division seems to be experiencing the typical challenges of cord-cutting and ongoing revenue decline, although offset by significant cost synergies. However, beneath this familiar narrative lies a compelling trend: Rogers is aggressively pursuing growth beyond its traditional wireline footprint, with ambitions to reach 100% of Canadian households. Their strategy? A three-pronged approach encompassing its existing wireline network, wholesale partnerships, and – crucially – FWA.

While Rogers remains tight-lipped on specific FWA subscriber figures, its national rollout of the service, coupled with the company's bold network slicing trial, suggests quiet confidence. Network slicing, a groundbreaking technology allowing for the creation of dedicated lanes for different types of wireless traffic, holds the key to unlocking FWA's full potential. By separating FWA traffic from mobile data streams, Rogers can guarantee consistent high-quality internet service to FWA customers without impacting its core mobile offering. This strategic move addresses a key concern that has hampered other telecom operators venturing into FWA: potential network congestion.

Furthermore, Rogers' recent acquisition of Comwave, a TPIA (third-party internet access) provider, strengthens its national FWA strategy. This acquisition provides the company with a platform to bundle internet service with its national wireless offering, even in areas where it lacks a wireline presence. This is a bold move, allowing Rogers to finally cater to the needs of the one-third of Canadian households currently outside its wireline footprint.

Analyzing Rogers' Cable Revenue

Rogers reported a 3% decline in pro forma cable revenue for Q4 2023, a trend continuing from previous quarters. However, the company expects to return its Cable business to organic revenue growth by Q4 2024. Achieving this turnaround without a significant contribution from FWA would require a substantial increase in internet subscriber additions within its existing footprint, a feat unlikely given the current competitive landscape. Therefore, it is reasonable to assume that FWA will play a crucial role in Rogers' Cable growth strategy.

Hypothetical FWA Subscriber Target

Let's hypothesize that FWA contributes 1% of the targeted 8-10% service revenue growth for 2024. This translates to roughly $170 million in incremental revenue. Considering Rogers is aiming for 100% household coverage, and assuming an average monthly revenue per user (ARPU) of $60 for FWA, this implies they are targeting approximately 280,000 new FWA subscribers. This figure seems achievable given the large addressable market and the lack of alternative high-speed options in many rural areas.

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The Potential Impact of FWA

The potential implications of this strategic bet are huge. Success in the FWA market would propel Rogers into a truly dominant position, allowing them to tap into a previously inaccessible customer base and strengthen its lead in the competitive Canadian telecom market. While other analysts focus on the conventional metrics of wireless subscriber additions and cost synergies, Rogers may be quietly setting the stage for a much larger victory – conquering the vast, underserved Canadian landscape through the power of fixed wireless access.

"Fun Fact: Did you know Rogers owns the iconic Toronto Blue Jays baseball team and the Rogers Centre event venue? Perhaps the high-speed, low-latency network slicing technology will someday power a revolutionary fan experience at the ballpark!"